If national and local governments are to achieve the very ambitious CO2 reduction targets that they have been set, or have set themselves (see section “CO2 and energy targets”), it is clear that policymakers must be prepared to make themselves both part of the solution and, in many cases, more unpopular.

This means that we can expect to see green regulation proliferating over the next few years as governments strive to find the right balance of carrot (e.g., tax reliefs and other incentives for green investment) and stick (e.g., taxes on energy consumption) policies to suit their aims. For the real estate industry, this means increasing regulation of both ownership and occupation and use of real estate. As buildings account for around 40% of the EU’s energy usage, it seems that the real estate sector is likely to bear the brunt of this new regulation.

In Spain, the Tax Measures for Energy Sustainability Act created other environmental taxes, such as the tax on the production of used nuclear fuel and radioactive waste in centralized facilities. It created two other taxes with environmental effects: the tax on the value of the production of electrical energy and the payment for the use of continental waters in the production of electricity. However, these could hardly be considered environmental taxes, in the sense that they will probably have little impact on electricity production or consumption.

The Environmental Tax Measures Act created a new tax on fluoridated gases and made amendments to other existing taxes.

Law 10/2022 of 14 June 2022 on urgent measures to promote the building rehabilitation activity in the context of the recovery, transformation and resilience entered into force. This law encourages more efficient use of energy in buildings by establishing tax benefits. In this sense, it introduces the following tax benefits in the personal income tax (IRPF):

• It establishes deductions in the IRPF applicable to the amounts invested in energy rehabilitation works in existing buildings.
• It establishes that aids granted under various programs for the energy rehabilitation of buildings are not included in the IRPF taxable base.

In addition, at the municipal level, the city councils may also approve tax benefits applicable to the taxes under their jurisdiction. For example, the Barcelona City Council grants a 50% reduction of the real estate tax for a period of three years for implementing voluntary solar collection installations. In addition, it has also provided for a reduction in the tax on construction, installations and works when the purpose of the works is to incorporate systems for the thermal or electrical use of solar energy, provided that these are not compulsory installations. The application of the discount will be conditioned on the fact that the installations for heat production include collectors approved by the competent administration.